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Credit Card Glossary: Terms and Definitions

Confused by credit card terms?'s glossary of credit card definitions will help. From account holder to Regulation Z, we have defined the most-common and most-confusing credit card terms.

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Federal funds rate

The federal funds rate is an interest rate set by the Federal Reserve Board's Federal Open Market Committee. It is the rate at which banks will loan each other money overnight to meet reserve requirements. It is also a key benchmark for short-term interest rates in the banking system. Banks set their prime rate based on the federal funds rate, affecting the rates consumers pay on loans and credit card balances.